Reminder to employers – don’t miss your P11D and PSA deadlines!

Many employers incentivise their staff with non-cash benefits, but it is vital to make sure you are reporting these to HMRC on time. There are large penalties for employers if they miss the filing deadlines and also if they make late payments of any National Insurance due.

Employers have to provide a P11D form for each employee declaring any benefits in kind received for the past tax year. Reportable benefits include items such as company cars and vans, private medical insurance and interest free or low interest loans provided to employees.

For the tax year which ended on 5 April 2021, the deadline for submitting P11Ds is fast approaching on 6 July, and the Class 1A National Insurance Contributions (NICs) that are payable on the benefits are due soon after on 22 July.

Penalties for late filing and late payment

HMRC impose penalties both for late filing and late payment. If you don't submit an Employer Declaration Form P11D(b) and supporting P11Ds to HMRC by 6 July you will be fined £100 for each month (or part month) your form is late, for every 50 employees.

What's more, there are also penalties for late payment of Class 1A NICs. These fines are of 5% of the amount outstanding 30 days after the due date, and increase by a further 5% after 6 months and again by another 5% after 12 months. It's very easy for these fines to escalate quickly!

Deadlines for PAYE Settlement Agreements - PSAs

If the benefits employees receive are small or irregular, an employer can enter into a PAYE Settlement Agreement or PSA with HMRC. Under a PSA, an employer pays the tax and National Insurance due on the benefits on the employees' behalf.

If you want to apply for a PSA for the tax year ended 5 April 2021, the deadline is also imminent - 5 July 2021 - with the calculations and tax and Class 1B National Insurance payments due to be paid by 22 October 2021. Benefits often included on a PSA are NHS cashback insurance, incentive awards and staff entertaining, including providing a ticket to a sporting event or small gifts.

Summary of key deadlines for employers

What you need to do

By when

Employers must apply for a PSA for the tax year ended 5/4/21

Monday 5 July 2021

Employers must submit P11Ds forms for the tax year 2020/21 to HMRC

Tuesday 6 July 2021

Employers must provide their employees with copies of their P11Ds

Tuesday 6 July 2021

Employers must tell HMRC the total amount of Class 1A NICs owed

Tuesday 6 July 2021

Employers must pay Class 1A NICs to HMRC

Thursday 22 July 2021

Employers must submit PSA calculations and pay and Class 1B National Insurance to HMRC

Friday 22 October 2021

If you need any help with your P11D and PSA compliance obligations or advice on benefits in kind, please get in touch with Zelie Byrne on 01273 484942 or Zelieb@knilljames.co.uk.

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